J&J could invest in Salt Lake City-based Coherex Medical (Update)

(Updates with comments from Coherex's board beginning in third paragraph.)

Johnson & Johnson may invest in Salt Lake City-based Coherex Medical Inc., a medical device maker, Coherex's chief executive officer said.

Johnson & Johnson, the New Brunswick, N.J.-based health-care supply company, will buy equity and debt from Coherex, which make closure devices for holes in the heart septum, Coherex Chief Executive Officer Richard Linder said in a telephone interview on Feb. 7. The deal will likely close by the end of next week.

The Deseret News previously reported that Linder said J&J may invest around $85 million. The company's board said those figures and other terms in this article are inaccurate. Because of ongoing negotiations, Coherex declined to give any additional terms.

“Rich Linder, CEO of Coherex Medical was recently discharged from the hospital with an acute illness and was interviewed in the setting of prescription medication use," said Brian Whisenant, chairman of Coherex's board, in an email. "The referenced interview includes numerous inaccuracies. Coherex apologizes to Johnson & Johnson, Boston Scientific, and Medtronic for these inaccurate statements and for this confusion. All of us at Coherex wish Rich a speedy and full recovery.”

Reached by email, Linder said he approved of the board's statement.

“My gut is Coherex will go to Johnson & Johnson,” Linder said in a telephone interview on Feb. 7. “It will not be an acquisition. Rather, it will be in the form of a strategic investment where many millions of dollars would be award to Coherex by Biosense Webster,” a Johnson & Johnson affiliate that deals in the diagnosis and treatment of cardiac arrhythmias.

“The debt component brings a tremendous amount of money to Coherex,” Linder said. “If we continue on in our relationship three to six months down the road, you’ll see an exit.”

During the six months, J&J will have access to data on migraine headaches gathered by Coherex in its overseas markets. The company’s device is designed to patch up holes in the septum that fail to close naturally after a baby is born, which are linked to migraines.

Coherex, which was founded 2003, is applying for approval in markets in Asia, Canada and Europe. It has not made it to America because of FDA regulations, Linder said.